Best area for Multifamily in Tennessee?

Question

Hi, I'm looking to invest in Tennessee, but not too familiar with the area. Is there a certain part of Tennessee that is ideal for multifamily? How's the Portland area?

Alex Craig · Answer

@Spencer Glaser I am not as bullish on Memphis for MF and I live here, buy real estate, sell real estate and manage real estate in Memphis. The MF in Memphis with the best #'s typically are in rough parts of town. I am always looking for MF 4 plexes are smaller. In the last 3 years I have bought for my own portfolio 2 and sold 5.  I like Little Rock much better. We have bought more for us and sold more too. Better areas, lower taxes.  Memphis MF is considered commercial. Anything over single family is taxed at an commercial rate which is about 2x higher then single family.

Christopher B. · Answer

@Nichole Ovens I am being a bit sarcastic. I truly love Knoxville. I don't think @Levi Graziano is out of line though. The amount of investors that have moved here over the past 5yrs is pretty astounding. Then they get online and talk about how everyone should "come to TN, it's so great here!!!" it has increased the competition and raised prices. I'm not as familiar with other markets obviously, but I feel that in Knoxville, like any market, you can find success with rentals about anywhere depending on the your strategy.

Levi Graziano · Answer

Low in inventory, high prices, lots and lots of competition

Nichole Ovens · Answer

Why do you think Knoxville stinks? Do you feel the same about some of the surrounding areas to the north or west, like OR, Lenoir City, Harriman, or Clinton?

Brandon Brown · Answer

@Ron Dayley Clarksville looks saturated with rentals, do you have any insight?

Christopher B. · Answer

Knoxville stinks, wouldn't come here

Elizabeth Wilson · Answer

@Jennifer Nguyen -  I'm biased on Memphis (of course!) but I would think any urban area - just like most of the US.  I know multis above 4 doors are taxed at a commercial rate not sure about other cities.  I'd check out tax rates and landlord/tenant laws.  Other than that, a deal is a deal (along with good PM!!)

Best of luck!

Keith Smith · Answer

@Jennifer Nguyen I always hear about people going to Memphis and Knoxville but have to say, I'm not knowledgeable of those areas. Nashville is unbelievably hot. Are you looking for a turnkey property or something you may need to do a little work on? You definitely need an agent that can catch wind of those properties before they hit the market. I'm closing on one in a couple of weeks that I felt lucky to get at market price. The only reason is because my agent heard about it before it hit the MLS. So I had an offer down before anyone else had looked at it and a bidding war started.

Like @Billy Brown stated, I would look at the outlying areas. I would throw in Columbia, Spring Hill (Maury County side, Williamson County side of Spring Hill is hot already because of schools), maybe even Shelbyville. Chapel Hill (to a lesser extent).

Billy Brown · Answer

Jennifer,

Depends on your cap rate desire.  Everywhere in Nashville is hot. most multi families are sold off market or the ones that are on MLS are way over priced.  Anywhere within a 20 mile radius of Nashville is good. Outlying areas like Fairview, Dickson, Ashland City and Goodlettsville are starting to heat up.

Best area for Multifamily in Tennessee?

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